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I was nowhere near getting 20 trades today, and I don’t care! Today was no day to be jumping in and out. If a trader made any significant money today, good on ‘em. They knew how to pick tops and bottoms and hold through chop. Quite proud of myself for showing restraint. Also happy that my trading rules kept me out of the crap for the most part.
Right from the get go there was something different about today. Nobody showed up for work it seemed, in all four markets. Very odd. The day’s activity on each chart only covered about ľ of the screen.
NQ started out chopping and changing, which turned me off right away. Often when this happens there will be a good move after the buggery is over, but today was a no go. I gave it one shot and decided to wait for something clearer. It never came.
Mark up stats:
Successes: took 0/3
Failures: took 2/7
Neutral: took 0/5
Potential: -15t
Monday:
-Take 20 trades minimum.
-Continue to watch the channels for direction, and the channel break rules for change of direction.
-Wait for clear structure before first trade of the day.
-Mark set ups in real time with colored arrows.
-If there is a trend, look for the 30 to 60 tick pull backs in tight formations.
-Maintain the good perspective that I am in a new phase and not get emotional.
-Focus on taking at least one A+ trade.
Another slow day. Not much to talk about. Stayed out of trouble. Was locked and loaded on a live trade but the set up did not fully trigger.
Could have taken a couple more shots but did not like how lethargic the markets were.
Mark up stats:
Successes: 0/2
Failures: 2/3
Neutral: 1/1
Potential: 0t
Tomorrow:
-Take 20 trades minimum.
-Continue to watch the channels for direction, and the channel break rules for change of direction.
-Wait for clear structure before first trade of the day.
-Mark set ups in real time with colored arrows.
-If there is a trend, look for the 30 to 60 tick pull backs in tight formations.
-Maintain the good perspective that I am in a new phase and not get emotional.
-Focus on taking at least one A+ trade live.
1/27/15 Tuesday
Live Trades: 0
Sim Trades: 4, -14t
Kind of got used to not trading over the past couple days which carried over to today. This should have been the day I hit the button.
It was obvious early that NQ would have a wide and loose day, meaning a lot of set ups. I took none. Lots of potential winners over there.
Three of the four trades I did take got to +30t so that was a positive. I exited at BE on each of them so potentially 90 ticks of gain was nullified.
Never mind, step 1) pick good entries. Step 2) manage them well. As I take more quality entries I will be more willing to hold for profit. Can’t get the cart before the horse. If a trader can’t consistently pick good trade areas, they are unlikely to be able to manage their trades with confidence.
That is what this marking of areas is all about right now. Convincing myself that I can pick good trade areas.
Mark up stats:
Successes: took 3/10, 30%
Failures: took 1/9, 12.5%
Neutral: took 0/3
Potential: +165t
Tomorrow:
-get “successes” taken up to at least 50% (this will naturally result in a higher % of “failures” taken, so be mentally ready for that)
-Continue to watch the channels for direction, and the channel break rules for change of direction.
-Wait for clear structure before first trade of the day.
-Mark set ups in real time with colored arrows.
-If there is a trend, look for the 30 to 60 tick pull backs in tight formations.
-Maintain the good perspective that I am in a new phase and not get emotional.
-Focus on taking at least one A+ trade live.
1/28/15 Wednesday
Live Trades: 0
Sim Trades: 11, -48t
No charts or journal post for Wednesday. Didn’t feel up to it
1/29/15 Thursday
Live Trades: 0
Sim Trades: 16, -35t
Got hacked up in oil today trying to be first out of the box. It is funny how whenever I open up my trading I seem to do it in areas that get choppy, instead of on the runners like GC or NQ.
Mark up stats:
Successes: took 6/11, 54%
Failures: took 9/14, 64%
Neutral: took 1/6, 17%
potential: +120t
Still finding it difficult to take all trades marked, even in sim. I guess I don’t want to see the havoc that could be wreaked. I'm not going to lie, I'm feeling a little low about this right now.
Edit: actually just calculated that had I let all my trades play to their natural conclusions, in other words -15 or +30, I would have made +57 ticks today instead of -35t. That's more encouraging considering this includes the chop up in oil.
One more day of this then I will take the weekend to assess where I am and where to go next.
Tomorrow:
-see how close I can come to taking every marked up trade and playing it to conclusion. One more day of this. Come on!
-Continue to watch the channels for direction, and the channel break rules for change of direction.
-Wait for clear structure before first trade of the day.
-Mark set ups in real time with colored arrows.
-If there is a trend, look for the 30 to 60 tick pull backs in tight formations.
-Maintain an attitude of discovery.
1/30/15 Friday
Live Trades: 0
Sim Trades: 15, +20t, was as high as +53
Did a better job of taking everything I saw and letting it play out -15 or +30. Some trades were hard to take and worked out, others were easy to take and didn’t. That should probably tell me something.
Marked a couple trades in hindsight. This is the dilemma, I do not want to fool myself by having hindsight bias so I try to mark hindsight losses as well. However, I am sure I lean more toward giving credit to winners.
In any case, it is important to at least be aware of the danger of bias so as not to get too full of it.
Marked areas:
Successes: took 5 of 9, 55% (three were seen live but marked in hindsight.)
Failures: took 9/9, a perfect 100%!
Neutral: took 2 of 2, 100%
Potential +135.
Interesting that I was able to take 100% of marked losing areas but only 55% of marked winning areas.
This exercise has been a good learning experience. This weekend I will do some thinking as to the next area of focus.
On CL there was some massive absorption of orders on the offer all the way up on the rally. At the top, huge orders stacked up in an effort to stop prices’ advancement and scare it the other way. The strategy worked as price reversed over 100 ticks after hours. I was able to make a successful trade off this action.
I calculate that the average price of the orders absorbed was around 46.70. It will be interesting to see if they take her back down next week, which would confirm to me that this was a large scale short positioning operation.
2/3/15 Tuesday
Live Trades: 0
Sim Trades: 11, +27t
Profit factor over past couple of months is around 2.0 but winner/loser percentage is pathetic at 34%. Essentially I am break even trading. If I am to pursue a profit factor of 2 I’ll need to pick more productive trade areas.
I will thus use the bigger tick charts (3 X entry chart) to filter for more quality trade areas that have more potential for movement of 30 ticks or more. The goal is to get at least 50% winners/losers at a profit factor of 2.0.
The same trend line and channel rules that I use with the smaller charts will be used to determine allowable trade direction.
-Essentially, as long as price stays on one side of a channel line on the larger chart, it is trades in that direction only.
-Set ups in older moves will be avoided unless there is evidence of a full day trend
-Trades in the opposite direction will only be allowed once price has broken and closed on the other side of a channel line. The more symmetrical the channel the better. Asymmetrical channels should raise caution as price is likely to continue in the direction of trend, creating various swings, until symmetry is achieved.
I have also once again come to realize that I do much better if I cautiously manage my trades. This means taking profit on first signs of stalling, moving to break even as soon as possible, and generally waiting for those strong fast moves to stay with a trade. I know this is not the popular thinking, but the results I get are much better than the set-it-and-forget-it type of management. The key is not to complain when the trade goes another 60 ticks after you've exited at +13 ticks.
When I see my trade quality improve I will be more inclined to let the trades play out. Until then it’s war, and I have to be willing to fight a battle on every trade.
Charts posted today are the larger tick charts: CL 2400 ticks, GC 1200 ticks, NG 600 ticks, NQ 1800
I have changed the trade markers to better see them on the chart. Navy for longs, yellow for shorts.
Tomorrow:
-use larger charts to filter for allowable direction
-use smaller charts for entry
-mark trade areas with colored arrows. Take as many as possible
-good attitude
There are reasons for the "set-it-and-forget-it" type management, and there are reasons for the "manage-it-intensely" type management. It depends on what your strategy is for the market, and what you can succeed with.
One size does not fit all....
So, you probably are wise to do what works best for you.
A while ago I began keeping a spreadsheet that tracked the overall price movement from entry for each of my trades, for the entire day, even well after I had closed the trade. I originally did this to see if perhaps trading the opposite of my tendencies might produce better results.
This data has been valuable for allowing me to see the true picture of my trade quality. I would recommend this to anyone who thinks their “trade management”, or not letting their trades “run” is what is holding them back.
I have discovered that only about 30% of my trades actually make it to my 2R target. This means that if I let my trades play out to their natural conclusion I will lose money.
Here is where price travelled from my entry for all 11 trades taken yesterday:
As you can see, only 4 of the 11 (36%) got to 2R (+30t), the rest would have stopped out at -15t. This would have resulted in +15t for the day minus commisions, with a lot of stress from the 7 losses.
Only 5 got to 1R, a less than 50% conversion rate at one to one. From yesterday's results I truly would have done better trading opposite my analysis. Sort of depressing actually.
Instead, I intensely managed based on price action, speed of market, feel, etc. There were a lot of scratch trades, a few less than 30 tick winners and I ended up with +27t.
We tend to remember the ticks we missed out on by exiting early, and we forget about the losses we avoided. Tracking my trades this way has helped put this in perspective.
Agree strongly, it's great to catch big winners and runners or even just 2-3X'ers, but the facts are more often as you state - it tends not to happen for 'normal' traders. If there is a compelling context picture on multiple timeframes that says 'Big Run' then that might change things, but you don't get many of those to the pound.
I've also done my own analysis of some of the 'big swingers' and their actual carried R:R's when comparing realised P/L results. They are often much closer to scalpers than you might believe, yet their perception is totally different because of the big trades that get remembered.
Five scratch trades today. Only one ended up going anywhere. Nothing much to speak of.
Missed out on the great move in oil. One trade got stopped out at BE and was not able to get myself to re-enter, though there were plenty of chances. It always seems too late until I look back and 150 more ticks have gone by. Need to recognize these long trending moves and get on board.
Liking the larger charts for directional filter. It’s keeping me out of trades with no potential and makes it easier to follow four markets.
Stats:
Successes: took 1/2
Failures: took 1/2
Neutral: took 3/4
Tomorrow:
-use larger charts to filter for direction
-use smaller charts for entry
-mark trade areas with colored arrows and get on board when opps arise! Shoot for a high trade taken/arrow ratio.
-good attitude
